When Law Is No Longer a Safe Bet

Lawyers discover the world of economic insecurity that their fellow citizens have inhabited for decades.

When I was contemplating becoming an English major, lo these many years ago, one helpful counselor told me that despite the stereotypes, English majors had lots of job opportunities. Advertising, public relations, academia. "And there's always law school!" she said chirpily.

I didn't end up going to law school; instead, after graduating, I embarked on a peripatetic odyssey of jobs and graduate school that culminated in my becoming a journalist. But I can imagine an alternative universe in which I did go to law school. Law school has long been the backup plan for humanities majors who don't quite dare to apply for food stamps.

That era appears to be ending. Noam Scheiber writes the obituary:

"'Stable' is not the way anyone would describe a legal career today. In the past decade, twelve major firms with more than 1,000 partners between them have collapsed entirely. The surviving lawyers live in fear of suffering a similar fate, driving them to ever-more humiliating lengths to edge out rivals for business. 'They were cold-calling,' says the lawyer whose firm once turned down no-name clients. And the competition isn't just external. Partners routinely make pitches behind the backs of colleagues with ties to a client. They hoard work for themselves even when it requires the expertise of a fellow partner. They seize credit for business that younger colleagues bring in.

"And then there are the indignities inflicted on new lawyers, known as associates. The odds are increasingly long that a recent law-school grad will find a job. Five years ago, during a recession, American law schools produced 43,600 graduates and 75 percent had positions as lawyers within nine months. Last year, the numbers were 46,500 and 64 percent. In addition to the emotional toll unemployment exacts, it is often financially ruinous. The average law student graduates $100,000 in debt.

"Meanwhile, those lucky enough to have a job are constantly reminded of their expendability. 'I knew people who had month-to-month leases who were making $200,000 a year,' says an associate who joined a New York firm in 2010. They are barred from meetings and conference calls to hold down a client's bill, even pulled off of cases entirely. They regularly face mass layoffs. Many of the tasks they performed until five or ten years ago—like reviewing hundreds of pages of documents—are outsourced to a reserve army of contract attorneys, who toil away at one-third the pay. 'All these people kept on going into this empty office,' recalls a former associate at a Washington firm. 'No one introduced them. They were on the floor wearing business suits. ... It was extremely creepy.' Still, any associate tempted to resent these scabs should consider the following: Legal software is rapidly replacing them, too."

The legal market has been changing for some time; the days when genteel WASP Republicans at white shoe firms refrained from poaching clients from other partnerships are decades past. And anyone who has read a John Grisham novel knows that desperate third-tier law school graduates are not a new phenomenon; the number of lawyers who got six-figure jobs at big corporate law firms was always a small fraction of those who graduated in any given year; with the exception of those who had a deep commitment to public interest law, the rest had to fight for scraps.

But life didn't used to be so harsh inside the firm. Getting the job used to be the great thing; once you had it, you were set. Oh, maybe you wouldn't make partner, but by then you'd know enough people to enjoy a soft landing in-house somewhere.

The recession changed all that. There are more law school graduates than ever, and fewer jobs for them to take. Fighting your way into a good firm just buys you the right to fight desperately to stay there. Once unthinkable, mass layoffs happen regularly ; and once those graduates are laid off, they have a hell of a time finding work. Did I mention that there are too many law school graduates for the available jobs?

The process of getting to equity partner -- where the real money is -- has also been delayed and can now stretch for more than a decade.

In other words, the safe backup is no longer safe. In this, lawyers are going through what rust belt manufacturing workers experienced in the 1970s, middle management in the 1980s, secretaries in the 1990s, and journalism in the 2000s. I once sat on a panel with a man who had worked for the Los Angeles Times for many years. He fondly recalled the day he got the job. "And the best part," he told his brother, "is that I never have to look for a job again." I think he either got laid off, or took a buyout, in the early aughts.

Professionals were not always sympathetic to the teamsters and machinists who lost "bad" jobs standing at manufacturing stations eight hours a day. Many of those people had taken factory jobs because they didn't want to bother with school, something that the folks who wrote policy briefs couldn't quite imagine. And to be fair, those manufacturing jobs were terrible jobs. I've toured massive assembly lines, and they always engender twin feelings of awe: at the massive machines and complex processes that can turn out an automobile every minute or so; and at the workers who can stand to show up every day to work on that line. I'd be out of my skull with boredom in 20 minutes.

But those jobs provided good paychecks, and something that human beings turn out to value very much: predictability. We want to know that if we invest years of our life in building a career somewhere, the investment will pay off. From the 1940s through the 1960s, committing to a union job meant, to be sure, some boredom and repetitive motion injuries. But you would not wake up at the age of 35, or 55, to find that your years of investment in a company and a skill were suddenly worth nothing. Even if your firm went under . . . well, other folks would be hiring machinists.

Now the professionals are discovering what it feels like to bet your youth on something that may not pan out. These articles on the decline of the industries that absorbed decades of humanities graduates have a panicked tone. If an education doesn't guarantee you a good job, what does? Are we living in a society in which all but the most ruthless go-getters will be economically insecure?

Well, probably. But welcome to the world most people live in -- and have always lived in. Even in those halcyon days of the 1950s, union jobs were a minority of work; union membership peaked in 1954 at 28 percent of all employed people. Most people were in less stable jobs, working for small businesses, in domestic service, and so forth. Read Studs Terkel's "Working" for a look at what employment in the 1960s was actually like, as opposed to what collective memory has airbrushed it into. There are a lot of people who have steady jobs at the telephone company or what have you . . . but also a whole lot of people eking out precarious livings as taxi drivers, entertainers, waitresses, and other jobs that could go away at any time. More than a few jobs don't exist any more, like the guys who worked Chicago apartment buildings, taking orders for goods that they would deliver, and then collecting payment on installment. It was a hard, sad job that seems to have disappeared thanks to the expansion of consumer credit.

In 1955, my grandfather, who owned a gas station, nearly saw his business destroyed when the state built a new thruway (his station was on the old main highway). Overnight, he lost most of his traffic. He'd survived the Great Depression, started a business, and then after 15 years of building up a solid living for his family, he was afraid he'd be wiped out -- and so were the guys who worked for him pumping gas or cleaning cars. He had to hustle to build up a service station business and make sure that folks in town came to him for their gas. He never got over being afraid of losing his living.

That was the actual reality for millions of people during what we think of as "the golden age" of job security. In reality, it was a golden age for a lot of people -- union manufacturing workers and college grads -- but just as tough as ever for small business owners and their employees. And of course for many people, like the millions of African Americans doing agricultural work or domestic service because racism kept them out of most workplaces, life was very insecure indeed.

That's not to say that things aren't getting worse; I think they are. But remember that we are not facing anything that our ancestors didn't have to cope with. Insecurity is rarely fatal, even if it's really frightening.

And we may have to learn to live with it, because no one seems to have a very good answer for how to fix it. Those lawyers aren't losing their jobs to trade, or something else that you can shut down; they're not even losing them to greed. They're losing their jobs because, on the one hand, their cartel is getting less effective at holding down the number of lawyers; and on the other hand, machines are getting better and better at doing complex cognitive tasks that we used to think were the exclusive province of trained humans. They can even sort through boxes and boxes of legal discovery documents, something for which associates used to bill hundreds of dollars an hour.

Eroding cartels and enhancing technological capabilities are the sort of things that almost everyone agrees are all for the good. But at the moment, for the folks who used to do the jobs that those machines are now taking over, they are all for the bad.

There are some rays of hope: after all, most of the jobs those machines are automating are jobs no one liked doing. The lawyers of my acquaintance do not pine for the hours they spent as associates, poring through boxes of documents.

In 1950, most large corporations had dozens, even hundreds of clerks, who would compute payroll, manually totting up hours, filling out paychecks, and recording the transactions. By 1965, computers had replaced almost all of those clerks. All of them were undoubtedly frightened when they lost their jobs, and for some of them, that may have been the best job that they ever did have.

But who today would want to get a job as a human adding machine? Progress is never without victims. The beneficiaries, however, are the whole human race.

This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.

    To contact the author on this story:
    Megan McArdle at mmcardle3@bloomberg.net

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